Growth in the Middle East and North Africa (MENA) remains modest due to regional conflicts, according to the World Bank's latest MENA Economic Update titled "Growth in the Middle East and North Africa." The report predicts a slight increase in the region’s overall GDP growth from 1.8 percent in 2023 to 2.2 percent in 2024, driven by Gulf Cooperation Council (GCC) countries, where growth is expected to rise from 0.5 percent to 1.9 percent.
Economic uncertainty in MENA is notably high, with levels twice that of other emerging markets and developing economies globally. This uncertainty stems largely from ongoing regional conflicts, which have severely impacted human lives and economies. In particular, the Palestinian territories face significant economic challenges, with Gaza experiencing an 86 percent contraction in its economy during the first half of 2024.
Lebanon also faces an uncertain future due to conflict-related issues. Neighboring countries like Jordan and Egypt are seeing declines in tourism and fiscal revenues as a result of these tensions.
The report highlights that "Peace and stability are the foundation of sustainable development," according to Ousmane Dione, World Bank Vice President for MENA. He emphasized the World Bank Group's commitment to engaging with conflict-affected areas in building a better future for all people in the region.
The report identifies opportunities for inclusive growth through reforms such as rebalancing public and private sector roles, improving labor market talent allocation, closing gender gaps, and promoting innovation. Despite educational advancements over five decades, female labor force participation remains at just 19 percent—the lowest globally—posing a barrier to economic prosperity.
"Transforming the role of the state would lead to substantial gains in productivity," said Roberta Gatti, World Bank Chief Economist for MENA. She noted that while public sector employment is high—especially among women—it does not necessarily equate to better public services. Shifting talent toward the private sector could yield productivity gains up to 45 percent.
Further boosting growth involves tapping into global knowledge and technology through increased international trade leveraging MENA's strategic location. Enhancing data quality and transparency is also crucial for fostering innovation.
Access to more detailed insights can be found [here].